Why is Apple jumping into Lala land?

TEXT OF INTERVIEW

Kai Ryssdal: It's not quite rocket science, but there is news from the junction of music and digital technology today. Apple announced it's buying a company called Lala.com. Lala is a music content provider. It's been around for about four years. And it can do some things that Apple and iTunes can't. Erica Ogg covers Apple for CNET.com. Erica, good to have you with us.

ERICA OGG: Sure. Thanks for having me.

Ryssdal: For the uninitiated amongst us, which I have to say until about 8 o'clock this morning included me. What is Lala?

OGG: Lala.com is a service where people can listen to music over the Web, as opposed to buying music and then downloading it to their computer.

Ryssdal: So it's streaming music, right?

OGG: Exactly, streaming music.

Ryssdal: What makes this attractive to Apple then?

OGG: Well, you know, we don't know. They haven't explained their plans to us. But there's a number of situations here. A lot of companies are turning toward streaming music over the Web, versus the download model, which is what Apple's iTunes is. And there's been sort of a rash of these companies getting picked up by competitors to iTunes. There's companies like iLike and imeem, which were picked up by MySpace earlier, which also has a big music effort. So this could be Apple maybe staking some room out for the future, in case they want to do this, or they could have specific plans in mind.

Ryssdal: Could those plans include you know other things like social connection and social media aspects to it? I mean, what else does Lala do that Apple doesn't right now with iTunes?

OGG: I think more people are getting used to the idea of streaming their music over the Web. Basically that means you don't have to own the music files. And so if you don't have to host the music on your own computer, it's going to be a lot more attractive to people that maybe don't have their iPod with them, or they don't have their home laptop with them, where the music is that they own, so they want to be able to listen to music anywhere.

Ryssdal: For all we don't know about Apple, and they are a secretive bunch, what do we know about what they're doing?

OGG: Well, we do know that they are building this huge data center in North Carolina. I think the price is somewhere $1 billion. So looking at this Lala acquisition, and looking at this server farm that they have, there is the idea that they could be planning to use that to store music, what's otherwise known as putting stuff in the cloud, then letting people access their music via the Web. We don't know that that's what they're doing. But when you put the two and two together, it seems like it could be possible.

Ryssdal: Play this out for me how it might change the way we listen to music. I mean obviously, Apple and iTunes have done a huge amount of that work already, changing how it's distributed and how we enjoy it. What might this do in the next three to five years?

OGG: Well, I think it comes down to the idea of whether you own music or not. You know, Apple's gotten us used to the idea of paying for something. We buy a song, and we put on our computer, and then maybe transfer it to a mp3 player. By streaming, you don't necessarily own it, and it's more like a subscription service. So there's been a lot of talk about Apple's entire iTunes store proposition, about whether they're thinking of doing the same thing, a subscription service for TV shows. They could also offer the same thing for music.

Ryssdal: Does that ring true for you, this idea of not owning this thing that you enjoy somehow?

OGG: I think we're getting used to it, especially with ideas like Hulu or Netflix where you can pay for access, and you can just watch movies whenever you want, but you don't necessarily own them like a DVD. I think people are getting more used to that idea.